2024 March 21

How OEMs Drive Innovation in Smartphone Accessories

When you purchase a new smartphone case, wireless charger or pair of headphones, you likely don't give much thought to where those accessories actually came from. The truth is, many of the accessories you use everyday are made possible by OEMs - Original Equipment Manufacturers.

Key Takeaways

  • OEM companies build accessories exactly how brands design them - like making a custom order.
  • Using OEMs allows brands to take advantage of manufacturers' ability to produce accessories quickly and in large volumes.
  • It's a win-win partnership - brands provide the designs, and OEMs provide the production skills and resources.
  • OEMs don't make anything until the brand asks for it, making the process efficient.
  • Unlike OEMs, ODM companies create their own designs from scratch and just have brands re-label them.
  • With OEMs, brands have to put in more upfront work creating the designs themselves.
  • As long as proper contracts are in place, brands maintain ownership of their custom OEM accessory designs.
  • Going the OEM route helps brands get their new, unique accessories to market faster than making everything in-house.

The Mobile Accessories Supply Chain: From OEM to Distributor

OEMs specialize in business-to-business transactions, supplying components and accessories to value-added resellers (VARs) like major smartphone brands. Unlike original design manufacturers (ODMs) that customize full products, OEMs focus on specific parts later assembled and branded by the VARs.

Ensuring efficient distribution of mobile accessories requires a well-orchestrated process involving OEMs, wholesale suppliers (such as Evelatus), distributors, retailers, and resellers. The express distribution flow begins with manufacturing and inventory management at the OEM production facilities. Once orders are placed, logistics operations transport the products to distributor warehouses for storage and inventory tracking.

Distributors then supply accessories to authorized retailers and resellers leveraging established channel partnerships and local market expertise. Pricing strategies and discounts are carefully implemented at each level to maintain profitability and competitiveness while meeting customer demand.

Though challenges like demand forecasting and product returns exist, technology solutions enable real-time collaboration and process optimization. By understanding this intricate supply chain, businesses can enhance operational efficiency and deliver mobile accessories seamlessly from OEMs to consumer markets.

What are OEMs?

OEMs are companies that manufacture components, parts and products based on the design specifications provided by another company or brand. In the world of smartphone accessories such as, OEMs are the factories and suppliers responsible for building key pieces like charging pads, screen protectors, audio equipment, soft cases for smartphones and more.

While these accessories bear the branding of major smartphone brands when they hit the shelves, it's the OEMs doing the heavy lifting of manufacturing them to exact standards behind the scenes. They are the unseen workforce giving life to new accessory designs and innovations.

The OEM Manufacturing Process

When a brand like Apple or Samsung wants to release a new case or charger, they handle the product design and engineering, creating detailed manufacturing specs. Those specifications are then sent to an OEM manufacturer with the production capabilities to build the accessories in mass quantities.

OEMs receive orders for millions of units and their highly automated factories go into production, stamping out each accessory part through injection molding, CNC machining, assembly lines and more. Once complete, the finished accessories are packaged up and shipped directly to brands to be sold under their respective names.

OEMs enable accessory brands to focus purely on design and development rather than dealing with the capital expenditures of manufacturing facilities. It allows them to rapidly innovate while tapping a global network of OEMs to turn their ideas into reality.

The OEM Ecosystem

Much of the OEM manufacturing for smartphone accessories is concentrated in Asian countries like China, Taiwan, Vietnam and India. Cities like Shenzhen have become OEM manufacturing hubs, home to countless factories and suppliers churning out cases, chargers, batteries, headphones and more for the world's biggest brands.

These OEM manufacturers are part of a massive ecosystem, with many specializing in particular types of accessories or components. It's an interconnected web of suppliers enabling the smartphone accessory market to operate with incredible speed, agility and production scalability.

As smartphones continue evolving with cutting-edge features and designs, OEMs remain indispensable partners. They manufacture the first units that bring new accessory innovations to life, while having the manufacturing muscle to produce them on a global scale. Their behind-the-scenes role is often overlooked, but ultimately vital in the smartphone world.

The pros and cons of OEM for Smartphone Accessories

Pros of OEM for Smartphone Accessories:
  • Wide availability - Many manufacturers offer OEM production capabilities.
  • Product customization - OEM allows brands to create accessories tailored to their target market's needs.
  • Intellectual property ownership - With proper contracts, brands maintain IP rights over the custom product designs.
  • Market differentiation - OEM manufacturing facilitates launching unique accessory products not available elsewhere.

Cons of OEM for Smartphone Accessories:
  • High upfront costs - Brands must pay for expensive tooling, molds, and specialized manufacturing setups.
  • Longer lead times - Setting up new customized production lines can take over a month.
  • Design responsibility - Brands must invest in creating detailed product specs and designs upfront.
  • Tech transfer challenges - Conveying designs accurately to manufacturers can be difficult.
  • The OEM model provides significant product customization benefits, but also requires brands to take on more upfront costs, time expenditures, and hands-on design work compared to alternative manufacturing approaches. Weighing these tradeoffs is key for accessory brands considering the OEM route.
evelatus logo
Written by Evelatus in 2024